You currently owe $118,580.44 on your mortgage loan, with an interest rate of 6.8%. Interest rates are currently 6.2% and you are thinking about refinancing, in which case you will borrow $120,000 for 15 years. You will incur loan costs of $2,150 on the new loan (payable in cash when you get the loan). You must also pay a $3,000 prepayment penalty on the old loan for paying it off early. Calculate your real APR on the new loan, assuming you do not pay it off early. с 6.90% 7.04% C 6.71% O 6.80%

You currently owe $118,580.44 on your mortgage loan, with an interest rate of 6.8%. Interest rates are currently 6.2% and you are thinking about refinancing, in which case you will borrow $120,000 for 15 years. You will incur loan costs of $2,150 on the new loan (payable in cash when you get the loan). You must also pay a $3,000 prepayment penalty on the old loan for paying it off early. Calculate your real APR on the new loan, assuming you do not pay it off early. с 6.90% 7.04% C 6.71% O 6.80%

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

You plan to borrow $47,800 at an 8.5% annual interest rate. The terms require you to amortize the loan with 7 equal end-of-year payments. How much interest would you be paying in Year 2?
You need a 30-year, fixed-rate mortgage to buy a new home for $210,000. Your mortgage bank will lend you the money at a 7.1 percent APR for this 360-month loan. However, you can afford monthly payments of only $850, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you to keep your monthly payments at $850? Multiple Choice $677,443.06 $726,330.71 $83,517.92 O $698,394.91
Someone buys a car for 12,000$ and puts 25% down. They then get a simple interest amortized loan for the rest of the amount at 7% for 4 years. Their month payment is 215.52, and total interest in 1344.96. What are the loan fees for this if the lender states that APR of the loan is 7.2%?
The bank will loan you $175,000 to buy a house. The loan terms are as follows; 30 year mortgage with monthly payments and a 6.9% annual interest rate (monthly compounding). What will your monthly payments be to the bank? If you will pay $1500 each year in taxes, $1200 in insurance, and $400 in HOA fees, how much will your total mortgage payments be each month? How much interest will you pay over the 30 year life of the loan?
You have a loan outstanding. It requires making three annual payments at the end of the next three years of $1000 each. Your bank has offered to restructure the loan so that instead of making the three payments as originally agreed, you will make only one final payment at the end of the loan in three years. If the interest rate on the loan is 5%, what final payment will the bank require you to make so that it is indifferent between the two forms of payment?
You need a 25-year, fixed-rate mortgage to buy a new home for $200,000. Your mortgage bank will lend you the money at a 6.6 percent APR for this 300-month loan. However, you can afford monthly payments of only $900, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. Required: How large will this balloon payment have to be for you to keep your monthly payments at $900? A) 48,522.47 B) 341,563.19 C) 67,932.38 D) 366,212.08 E) 352,127.00 Only typing answer Please explain step by step without table and graph
A borrower takes out a 30-year loan for a house worth $250,000. If the annual interest rate is 6%. if the borrower chooses to pay $40,000 at the end of year 12, what will the new payments be assuming the loan maturity will not be reduced?
You need a 25-year, fixed-rate mortgage to buy a new home for $240,000. Your mortgage bank will lend you the money at an APR of 5.35 percent for this 300-month loan. However, you can afford monthly payments of only $800, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you to keep your monthly payments at $800? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Balloon payment
A $230,000 mortgage has a stated annual rate of 4.5% on a 30 year loan. Approximately how many payments would it take to pay off the loan if you made payments of $2000 each month? (NOTE: don't forget to "undo" to get your formula back into the payment amount in your table after changing for this question!)
You need a 20-year, fixed-rate mortgage to buy a new home for $320,000. Your mortgage bank will lend you the money at a 6.9 percent APR for this 240-month loan. However, you can afford monthly payments of only $2,700, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you to keep your monthly payments at $1,200? O $178,691 $300,333 $116,636 $122,597 O $100,748
Suppose you want to purchase a house. Your take-home pay is $4270 per month, and you wish to stay within the recommended guidelines for mortgage amounts by only spending 1/4 of your take-home pay on a house payment. You have $18,500 saved for a down payment and you can get an APR from your bank of 5.7%, compounded monthly. What is the total cost of a house you could afford with a 3030-year mortgage? Round your answer to the nearest cent, if necessary.
To repay a $35,000 loan you will make 30 equal annual payments (starting one year from today) of $4,998.10. What is the interest rate on the loan? If you don’t have a financial calculator, you can use the fact that it is one of the following rates. a) 8% b) 10% c) 12% d) 14% e) 16%

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